Children of Men: The ABL Industry’s Looming Talent Infertility Crisis

Alfonso Cuarón's 2006 masterpiece Children of Men is set in a 2027 dystopia where humanity has been infertile for eighteen years. No babies have been born. No next generation is coming. Society has not collapsed in one dramatic explosion, it has simply degraded, slowly, and then all at once, into chaos and tribalism. The film's horror is not a single catastrophic event. It is the quiet, creeping realization that nobody thought to fix the pipeline until it was nearly too late. Now picture the asset-based lending industry mere months away from 2027.

The pipeline of properly trained, credit-grounded, relationships-first business development officers (BDOs) just the kind the industry spent decades developing inside the big bank ABL shops of the 1990s has been quietly going infertile for years. Few noticed or started to plan because the gray-haired Gladiators were still fighting in the arena. But those warriors are aging out, moving into management, or simply leaving an industry that no longer seems to know what it wants from them. And when you look around for the next generation, the field is thinner than anyone wants to admit.

The industry stopped manufacturing BDOs the way banks once did. It started importing them, poaching them, or doing without.

The Old System That Built a Generation

For those who were not there, it is worth remembering what the big bank ABL shops of the 1980s and 1990s actually did. They ran credit training programs that were, in effect, graduate schools for commercial finance. You joined as an analyst, you traveled as a field examiner, you underwrote deals under a senior lender who had seen cycles, and you emerged after years, not months as someone who could actually assess collateral, read a borrowing base, smell trouble in a borrower's A/R aging, and then go out and sell the next one. The knowledge was transferred, deliberately, person-to-person.

The names of some, but not all of those institutions: Foothill Capital, Congress Financial, CIT, Fleet Capital, Heller, GECC are either gone or unrecognizable. But the people they trained are the backbone of the industry today. They are the managing directors, the regional heads, and the founders of independent shops. They are, in a very real sense, the last generation born of that system. And they are not being replaced at the same rate they are leaving.

The Infertility is Structural, Not Accidental

This is not a story about laziness or bad intentions. It is a story about structural incentives that, over two decades, quietly defunded the very system that made the industry work.

As the big bank-ABL groups got acquired, merged, and rationalized, the training programs went with them. Economies of scale meant fewer junior seats. Pressure to produce meant faster production timelines, which means no one had three years to develop an analyst into an underwriter and/or into a BDO. Private equity-owned platforms needed ROIC now, not a talent development ROI that would take a decade to materialize. The result was that the industry shifted from growing BDOs to hiring them, and then from hiring trained ones to hiring adjacent ones – bankers, relationship managers, and generalists who could be pointed at commercial finance and figure it out. Some did figure it out, but figuring it out is different from being trained/apprenticed for it. 

The Complication: ABL Itself is Changing

Here is where the Children of Men movie metaphor gets complicated and more honest. In the film, the question is not just whether humanity can reproduce. It is what kind of world is worth reproducing into. And in ABL right now, a serious version of that question is being asked, whether the industry acknowledges it or not: Is the traditional BDO model actually what the next era of this business requires? The honest answer: maybe not entirely.

The market is moving in a direction where ABL is increasingly being treated as a product rather than a practice. Large bank platforms with captive deal flow from their commercial banking relationships do not need a BDO cold-calling intermediaries. They need a sophisticated credit professional who can structure and execute. Private credit funds that access deals through investment banks and debt advisors running wide processes do not need a relationship farmer. They need speed, structure, and a term sheet that wins on economics. The proliferation of FILO, stretch ABL, and hybrid structures means that the borrowing base itself is becoming not just a pure collateral-monitoring discipline.

In this version of the future, ABL does not die, but it morphs. It becomes a line item in a platform lender's product menu. And platform lenders need product specialists, not gladiators.

But the Lower Middle Market is Not That Future…Not Yet

The complication has a counter-complication. Because for every large-ticket deal that runs through an investment bank process where the BDO is essentially a glorified order-taker, there are dozens of sub-$20 million situations where a credit-trained, market-embedded, relationship-owning BDO is the entire reason the deal gets done.

The lower middle market family-owned businesses, PE-backed companies too small for the big platforms, turnaround situations that need a lender with judgment not just a borrowing base calculator -- that market runs entirely on trust, expertise, and the ability to say yes when everyone else says no. That requires a particular kind of person. One who knows credit cold, has seen a cycle or two, can speak fluent collateral to a skeptical credit committee, and has cultivated the referral relationships over years of showing up, following through, and being right more often than wrong.

The lower middle market cannot survive on imported talent and process-driven originations. It needs people who were built for it.

What the Industry Must Do Before the Last Ship Leaves Port

The ending of Children of Men is cautiously hopeful. There is a tomorrow if anyone is willing to fight for it.

The ABL industry has a version of that choice right now. It is not too late to build a talent pipeline, but the window is narrowing. A few things need to happen, and they need to happen with intentionality rather than optimism.

First, the independent non-bank platforms, the ones that still do ABL as a craft rather than a product, need to invest in junior talent again. Not hire-to-fire analysts, but genuine credit apprentices who are given time, mentorship, and a path to becoming a field-credible BDO. The economics are harder than they used to be, but the alternative is a permanent dependency on the same shrinking pool of mid-career talent, fought over at ever-increasing cost.

Second, the industry trade groups should consider treating talent development as an existential issue, not a programming afterthought. The mentoring programs, training curricula, and young professional networks that exist today are good, but they are not enough. A meaningful apprenticeship pipeline, modeled on what the old bank shops did but adapted to the current fragmented landscape, would be worth more to the industry's long-term health than any number of conference panels about the future of private credit.

Third, and most importantly, the industry needs to be honest about the bifurcation that is coming. The large-ticket, process-driven, platform-dependent world of ABL does not need the same talent as the lower middle market. Trying to pretend otherwise leads to mismatched hiring, frustrated professionals, and wasted institutional investment. The two markets need different development paths, different incentive structures, and different definitions of success.

The Real Dystopia is Consolidation Without Succession

The bleakest reading of Children of Men is not the one where humanity ends. It is the one where the institutions that were supposed to preserve humanity – the government, the military, the factions – became so consumed with their own survival and power that they forgot the actual mission. 

The ABL industry's version of that dystopia is not one where commercial finance disappears. It is one where the continued consolidation of platforms, the migration upmarket, and the productization of ABL leaves the lower middle market chronically underserved – not because the capital dried up, but because the people who knew how to deploy it wisely were never replaced. The institutional knowledge that made ABL a genuine financial craft, the ability to look at a messy collateral situation and figure out a structure that actually worked for everyone, will have quietly moved offshore to the next generation that nobody built. That is the Children of Men ending nobody in this industry wants to write.

The boat to build a new talent pipeline is still in the harbor. The question is who is willing to get on it.

This article first appeared on ABL Advisor: https://www.abladvisor.com/articles/43240/children-of-men-the-abl-industrys-looming-talent-infertility-crisis